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Death By A Thousand Cuts

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DOW – 54 = 21,574
SPX + 1 = 2460 (record)
NAS + 29 = 6344 (record)
RUT – 3 = 1427
10 Y – .05 = 2.26%
OIL + .30 = 46.32
GOLD + 8.30 = 1243.00
BITCOIN + 0.45% = 2338.41 USD
ETHEREUM – 9.33% = 225.56

The S&P 500 and the Nasdaq closed at records.

Last night, two Republican senators, Mike Lee of Utah and Jerry Moran of Kansas, issued statements declaring that they would not vote for the revamped BCRA health care bill. The two senators timed the release of their statements and made clear that modest tinkering around the edges of the legislation drafted by Senate majority leader Mitch McConnell would not be enough to meet their demands.

They joined a pair of GOP colleagues in calling for a complete redrawing of the legislation that would take many months, short-circuiting McConnell’s wish to end the debate this month. So, the plan to repeal and replace Obamacare is dead, at least for the foreseeable future. Trump tweeted: “Republicans should just REPEAL failing ObamaCare now & work on a new Healthcare Plan that will start from a clean slate.”

And so, this morning, McConnell started to push for a repeal only bill; an idea that would immediately push insurers out of the marketplace. The repeal plan never got off the ground. Three senators said they would not support a motion to proceed on the efforts to repeal without a ready-made replacement. So, repeal and replace is dead, and repeal-only is dead.

What next? Insurance companies are asking the same question and they are facing an uncertain future. Obamacare’s insurance markets still have problems, with insurers pulling out of some areas and raising premiums in others. Trump has many powers at his command to undermine them further, and has threatened to do so.

And there’s no map and no timeline by which lawmakers might find a resolution. Individual markets continue to spiral downward partly because of the inherent issues in Obamacare’s market architecture and partly because of Republican efforts to make things even worse. In some states, Obamacare is doing relatively well, but in others it’s struggling and even starting to fail.

Many insurers have stopped bleeding money from sicker-than-expected enrollees, but they remain wary about continuing to play on the exchanges. The number of insurers filing initial applications on the federal marketplace dropped 38% for 2018. That figure could grow if more insurers get spooked by Washington’s indecisiveness. Insurers aren’t locked into participating in 2018 until late September. Open enrollment begins November 1.

The next deadline comes this week, when the Trump administration must decide whether to keep paying what are known as cost-sharing subsidies. The subsidies help low-income people afford co-payments and cost-sharing on medical services, and their legitimacy is the subject of a legal dispute. The Trump administration has threatened to stop making them.

Obamacare might not implode but it could still die a death...